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At the end of 2022, BMCI and Equatorial Coca-Cola Bottling Company (ECCBC) Morocco signed the first “Sustainability Linked Loan” (SLL) financing in Morocco, which consists of granting a loan whose cost is indexed on sustainability criteria.
The BMCIa subsidiary of the BNP Paribas Group, becomes the first bank in Morocco to launch a SSL credit through the financing granted to ECCBC Morocco for the acquisition of Atlas Bottling Company. An SLL is a new type of financing for businesses. This is a credit whose cost is indexed on sustainability criteria.
In addition to the traditional financial covenants, the bank and its client negotiate Extra-financial KPIs, environmental or social, sufficiently material and ambitious for the company’s sector of activity. The achievement of the objectives defined for these indicators during the term of the loan gives rise to a downward revision of the loan interest rate. An SLL can be contracted by any type of company, regardless of its sector of activity and its level of maturity on ESG aspects. The use of this type of financing makes it possible to reduce its cost of financing while contributing to the achievement of the objectives of sustainable development.
Based on the achievements of BMCI and the BNP Paribas Group in terms of commitment and compliance with the various ESG standards, ECCBC Morocco has entrusted BMCI with the financing structuring of this acquisition. BMCI has been appointed as Sole Arranger, Lead Manager, Credit and Securities Agent and Coordinator on ESG aspects. This transaction thus reinforces BMCI’s position as a major player in energy transition and regional support. The law firm AB Law Group acted as exclusive legal adviser toECCBC.
Funding indexed to ESG indicators
The terms of this new financing are indexed to ESG indicators ambitious projects that reflect current social and environmental issues. ECCBC has developed an ESG impact strategy up to 2030 which aims to strengthen the sustainability of the company by ensuring that it meets the requirements of its internal and external stakeholders and contributes to protecting the shared environment.
In addition, BMCI has conditioned financing on the basis of strict compliance with precise and measurable indicators. In practice, the following indicators will be monitored by the bank for all lenders involved in this transaction:
- Reduction of its CO2 emissions ;
- Improvement of the collection of plastic bottles and cans, in collaboration with local partners and under the aegis of international organizations;
- Reduction of water consumption for finished products;
The performance threshold to be achieved for each of these indicators, is in line with the material challenges of the beverage industry, and regular monitoring of these KPIs will be carried out.
“This signature reflects our commitment to maintain our efforts to become an even more responsible, inclusive, diverse and sustainable company and which is added to all our initiatives and plans in line with our ESG strategy. With this partnership, we join forces to achieve even more ambitious social and environmental goals to improve the future of our country and our continent. “says Fayçal Zitounithe Managing Director of ECCBC Morocco.
“We are proud to support ECCBC Morocco in the context of the first SLL financing established in Morocco, which is part of the relationship of proximity and trust that binds our two Groups. This transaction also confirms our commitments in favor of sustainable development and the financial support of our clients in the necessary ESG transformations. “says Hisham SEFFAChairman of the Management Board of BMCI.
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